The figure below represents the domestic market for wheat in a small country. Imports of wheat are prohibited.
Following the imposition of a $20 per bushel export subsidy to the country's wheat exports, the country consumed ________ bushels of wheat and exported ________ bushels of wheat.
A. 60; 90
B. 60; 60
C. 40; 80
D. 40; 110
Answer: D
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What will be an ideal response?
An increase in the price of poultry would lead to
a. a decrease in quantity demanded of fish and an increase in the demand for poultry. b. a decrease in quantity demanded of poultry and an increase in the demand for fish. c. an increase in quantity demanded of fish and a decrease in the demand for poultry. d. an increase in quantity demanded of poultry and a decrease in the demand for fish.
"Budget deficits are inflationary." The truth of this statement depends on
a. aggregate demand in the economy. b. the shape of the aggregate supply curve. c. the size of the national debt. d. existing debt as a percentage of GDP.
If the economy has an inflationary GDP gap, one possible solution is to increase government expenditures.
Answer the following statement true (T) or false (F)